| Re: | American DG Energy Inc. Amendment No. 2 to Form SB-2 File No. 333-142008 |
| 1. | We note your response to comment 1 in our letter dated May 8, 2007. Also, we note your chart at the end of your response letter dated June 27, 2007. Please include this chart in your registration statement. |
| · | Please disclose the relationships, if any, among the selling shareholders. If none, please state and include the statement in your document. |
| · | In your response, you state that none of the selling shareholders is in the business of buying and selling securities. Please disclose this statement in your registration statement. |
| · | Please disclose the dollar value of the shares being registered in relation to the proceeds that you received from the selling shareholders for the securities, excluding amounts of proceeds that were returned, or will be returned, to the selling shareholders or their affiliates in fees or other payments. |
| · | Please disclose the discount at which the shareholders will purchase the common stock underlying the convertible notes, or any related security, such as a warrant or option, upon conversion or exercise. |
| 2. | We note your response to comment 2 in our letter dated May 8, 2007. As we asked in prior comment 2, please disclose in tabular form the combined conversion price of the total number of shares underlying the convertible note calculated by using the conversion price on the date of the sale of the convertible note and the total possible number of shares the selling shareholders may receive. If you believe the total number of shares underlying the convertible note is the same under these facts, please explain why. |
Principal Amount of Convertible Notes | Interest Payments | Conversion Price Per Share | Aggregate Conversion Price | Aggregate No. of Shares Issuable Upon Conversion as of July 25, 2007 |
| $6,075,000 | 8% per annum, due and payable quarterly in arrears | $0.84 | $6,075,000 | 7,232,145 |
| 3. | We note your response to comment 4 in our letter dated May 8, 2007. In this regard, we note that you have provided the information in your chart relating to the date of the transactions and the number of shares of the class of securities subject to the transactions that were issued or issuable in connection with the transactions. However, you have not provided any of the other information we requested in that comment. Please revise or advise. |
| · | the date of the transaction; [Response: Previously provided in the chart that has been added to the prospectus, as noted in the comment.] |
| · | the number of shares of the class of securities subject to the transaction that were outstanding prior to the transaction; [Response: This information has been added as a footnote to each transaction listed in the chart that has been added to the prospectus.] |
| · | the number of shares of the class of securities subject to the transaction that were outstanding prior to the transaction and held by persons other than the selling shareholders, affiliates of the company, or affiliates of the selling shareholders; [Response: Note that the selling stockholders comprise all of the Company’s shareholders. However, the information should be clear from the chart since affiliates are separately identified. ] |
| · | the number of shares of the class of securities subject to the transaction that were issued or issuable in connection with the transaction; [Response: This information appears in the chart.] and |
| · | the percentage of total issued and outstanding securities that were issued or issuable in the transaction, assuming full issuance, with the percentage calculated by taking the number of shares issued and outstanding prior to the applicable transaction and held by persons other than the selling shareholders, affiliates of the company, or affiliates of the selling shareholders, and dividing that number by the number of shares issued or issuable in connection with the applicable transaction. [Response: The information relating to the percentage of the offering relative to the shares held by non-affiliates has been added as a footnote to each transaction listed in the chart that has been added to the prospectus.] |
| 4. | We note your response to comment 5 in our letter dated May 8, 2007. Please include the response to the first bullet point of comment 5 in your document. In other words, notwithstanding your expectation that the outstanding convertible debt will be converted into common stock, disclose your financial ability to make all payments on the overlying securities, including interest payments. |
| 5. | We note your response to comment 6 in our letter dated May 8, 2007. In that response, you state that you “will add to the disclosure in the prospectus a description of the sales of unregistered securities by the company in the last three years.” However, our comment requested more information than simply a description of the sales of unregistered securities by the company in the last three years. Therefore, please provide the following: |
| · | a materially complete description of the relationships and arrangements that have existed in the past three years or are to be performed in the future between the issuer, or any of its predecessors, and the selling shareholders, any affiliates of the selling shareholders, or any person with whom any selling shareholder has a contractual relationship regarding the transaction, or any predecessors of those persons — the information provided should include, in reasonable detail, a complete description of the rights and obligations of the parties in connection with the sale of the convertible notes; and |
| · | copies of all agreements between the issuer, or any of its predecessors, and the selling shareholders, any affiliates of the selling shareholders, or any person with whom any selling shareholder has a contractual relationship regarding the transaction, or any predecessors of those persons, in connection with the sale of the convertible notes. |
| 6. | We note your response to comment 8 in our letter dated May 8, 2007 and your disclosure on the outside cover of the prospectus stating that this prospectus may not be used by the selling shareholders to sell any shares prior to the time that your common stock becomes publicly traded. Regardless, given that no market currently exists for your shares, it is our position that the selling security holders must offer the shares being registered at a fixed price. Based upon the registration statement fee table, it appears that the relevant initial offering price of the shares is $0.70 per share. Once your shares are quoted, then the selling shareholders may sell the registered shares at the prevailing market price. Accordingly, please revise your cover page and the remainder of the prospectus to indicate that your selling security holders will sell their shares at the initial offering price of $0.70 per share until the shares are quoted, at which point the selling shareholders may sell the registered shares at the prevailing market price. |
| 7. | We note your response to comment 9 in our letter dated May 8, 2007. Please disclose in what manner Adam M. Schachter, Irwin M. Schachter, and Nancy Schachter are “associated” with Wachovia Securities, and how Michael Zuk is “associated” with Oppenheimer & Co. Please also specifically state that these persons are underwriters, as opposed to stating that they "may be deemed to be underwriters." |
| 8. | We note your response to comment 10 in our letter dated May 8, 2007. In that response, you state that each selling shareholder that is an affiliate of a broker-dealer purchased the securities to be resold in the ordinary course of business and, at the time of the purchase, the seller had no agreements or understandings directly or indirectly with any person to distribute the securities. Therefore, if true, please disclose in your registration statement that Adam M. Schachter, Irwin M. Schachter, Nancy Schachter, and Michael Zuk purchased the securities to be resold in the ordinary course of business and, at the time of the purchases, the sellers had no agreements or understandings directly or indirectly with any person to distribute the securities. |
| 9. | We note your response to comment 11 in our letter dated May 8, 2007. Please disclose the natural person or persons who exercise the sole or shared voting or dispositive powers with respect to the shares to be offered by GGCP, Inc. |
Sincerely, AMERICAN DG ENERGY INC. /s/ Anthony S. Loumidis By: Anthony S. Loumidis Chief Financial Officer |
| cc: | Mara Ransom, Legal Branch Chief John Fieldsend, Staff Attorney |
